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Corn, wheat decline as investors weigh Ukraine supply concerns

Published 03/06/2014, 06:26 AM
Updated 03/06/2014, 06:26 AM
Corn edges lower as investors weigh Ukraine supply concerns

Investing.com - U.S. corn and wheat futures weakened on Thursday, as investors continued to monitor developments surrounding the political and military crisis between Russian and Ukraine.

The U.S. Department of Agriculture expects Ukraine to be the fifth-biggest wheat exporter and the third-largest shipper of corn in the current marketing year. A disruption to supplies from Ukraine could mean increased demand for U.S. grains.

Market players looked ahead to the USDA’s weekly export report later in the session to gauge the strength of global demand for U.S. supplies.

On the Chicago Mercantile Exchange, corn futures for May held in a range between $4.7863 a bushel and $4.8188 a bushel. Corn prices last traded at $4.7988 a bushel during U.S. morning hours, down 0.3%.

The May corn contract rallied to $4.8800 a bushel on Wednesday, the most since September 3, before erasing gains to settle at $4.8200 a bushel, down 0.46%.

Ukraine is forecast to export 18.5 million tonnes of corn in the current marketing season, representing 16% of global trade, according to the USDA.

Meanwhile, wheat for May delivery held in a range between $6.3638 a bushel and $6.4163. Wheat last traded at $6.3675 a bushel, down 0.85%.

The May wheat contract dipped 0.16% on Wednesday to settle at $6.4240 a bushel. Prices hit $6.4560 a bushel on Tuesday, the highest since December 10.

The USDA projected that Russia and Ukraine will produce a combined 74 million tonnes of wheat in the 2013-14 marketing season and export a total of 26.5 million tonnes of the grain, representing 17% of world trade.

According to the USDA, Ukraine is forecast to export 10 million tonnes of wheat in the current season, while Russian wheat shipments are expected to total 16.5 million tonnes.

Elsewhere on the CBOT, soybeans futures for May delivery inched up 0.55% to trade at $14.2850 a bushel. Prices of the oilseed declined 0.18% on Wednesday to settle at $14.2040 a bushel.

The May contract hit a six-month high of $14.4540 a bushel on February 27, as hot and dry conditions in key growing regions in Brazil and Argentina fuelled concerns over crop prospects.

Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.

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